2009 Senate Bill 838

Create legislative “vehicle” for business tax hike

Introduced in the Senate

Sept. 17, 2009

Introduced by Sen. Michael Switalski (D-10)

To make non-substantive wording changes to the Michigan Business Tax act. This is a parliamentary device sometimes used for quickly adopting a tax increase in the event the votes are found for one as part of the process of closing a gap between the amount of state spending desired by the administration and many legislators, and the amount of revenue expected in the absence of a tax hike.

Referred to the Committee on Finance

Oct. 8, 2009

Substitute offered

To replace the previous version of the bill with one that contains actual MBT revisions; see Senate-passed version.

The substitute passed by voice vote

Amendment offered by Sen. Nancy Cassis (R-15)

To increase the residency standards for film studio employees that make a production eligible for subsidies. Currently they must have lived in the state for at least 60 days, and the bill would increase this to 180 days. Also, in increase the subsidy for film "infrastructure" projects from 25 percent to 32 percent of the expenses incurred by the developer.

The amendment passed 25 to 8 (details)

Amendment offered by Sen. Randy Richardville (R-17)

To remove provisions that would have reduced the value of certain research and development tax credits.

The amendment passed 32 to 1 (details)

Passed in the Senate 19 to 14 (details)

To lower the Michigan Business Tax surcharge from 22 percent to 14.66 percent in 2010, 7.33 percent in 2011, and zero after that (unless the legislature later suspends the phase-out); slightly lower the value of film production subsidies and cap at $1 million any one production's subsidy; cap certain targeted tax breaks; raise the caps on the maximum share of a business’s income that the proprietor or shareholder of a small business can receive and still be eligible for a lower small business MBT rate; earmark $100 million in MBT revenue to schools; and make other MBT revisions.

Received in the House

Oct. 13, 2009

Referred to the Committee on Tax Policy